I was renewing my first aid qualification recently and some statistics really hit home.
- Less than 1 in 10 people in Britain survive an out-of-hospital cardiac arrest.
- In countries where cardiopulmonary resuscitation (CPR) is taught in schools on the other hand (e.g. Norway), as many as 1 in 4 survive.
It seems that providing folks with an early education in first aid fundamentals improves heart attack victims’ chances of making it through their experience alive.
In the same way, a recent report by a group of international lawyers has argued that making Legal Expenses Insurance (LEI) more widely available would improve access to justice, giving some people a possible legal remedy where otherwise their chances would be as good as dead.
In this article, we are going to consider 3 questions related to LEI. Firstly, what is LEI and what types of LEI exist? Secondly, who is most likely to benefit from taking out LEI? And, lastly, why you should make a general check of insurance policies you may have already.
What is LEI?
LEI is also sometimes known as legal protection insurance.
LEI is an insurance product which you can buy to enable you to cover some or all of the cost of obtaining legal advice in particular types of situation.
One definition of LEI is a type of insurance which promises, against the payment of a premium, to bear the cost of legal proceedings and provide other services directly linked to the insurance cover, in particular, with a view to the following:
- compensation for loss, damage or injury suffered by the insured person by settlement out of court or through civil or criminal proceedings, and
- representing the insured person in any civil, criminal or administrative proceedings raised against that person.
LEI policies are grouped into ‘before the event’ (BTE) and ‘after the event’ (ATE) policies.
If we are talking about personal injury claims, the ‘event’ is the accident/injury. A BTE policy is one that was already in place at the time of the accident; an ATE policy is one that is only taken out after the accident.
BTE premiums tend to be lower than ATE premiums because the risk to the insurer is lower. The risk the insurer takes on will include the possible legal costs of your opponent in the dispute in the event that your claim is unsuccessful.
In a BTE situation, you’re taking out the policy at a time when you may never have, say, an accident. The insurance may not ever need to kick in at all. On the other hand, in an ATE scenario, by definition, the ‘event’ has happened and you do need legal advice. Accordingly, the risk to the insurer is higher and the premium is usually higher as a result.
So, having gone through a rough explanation of how LEI works, let’s look more closely at ‘before the event’ insurance and who might most benefit from having the foresight to take out that insurance.
Who is most likely to benefit from (BTE) LEI?
We talked above about access to justice.
As the well-known English lawyer, Michael Mansfield Q.C., has been quoted as saying, access to justice is “a much broader concept than access to the courts and litigation. It encompasses a recognition that everyone is entitled to the protection of the law and that rights are meaningless unless they can be enforced. It is about protecting ordinary and vulnerable people and solving their problems.”
Being able to get legal advice so you can understand and enforce your legal rights in a given situation is a problem worldwide. Indeed, it’s not just about access to legal advice; you need someone who will represent your interests robustly and ‘fight your corner’ for you.
At the very least, though, if you improve access to legal advice for folk it generally means you will get better access to justice following on from that.
The recurring thorny issue is for people in what is known as the ‘forgotten middle’.
Imagine an ‘access to justice’ graph showing a line curve-shaped like the outline of a bell.
At one extreme, you have people who are able to afford to pay for private legal advice.
At the opposite extreme – though not in all countries of the world – you have people who have financial means below a certain level; a level which gives them entitlement to state assistance in obtaining legal advice (e.g. legal aid).
In the middle, there are people (possibly with the largest number among the 3 groups) who cannot afford private legal advice and do not qualify for legal aid. These people are most likely to be denied access to justice. They cannot pay for legal advice and they don’t qualify for help to get legal advice. They are the ‘forgotten middle’.
The International Bar Association’s (IBA) report highlights the fact that LEI is a way by which the forgotten middle could affordably access legal advice (because, where necessary, it will be paid for by the insurer) and, as a result, get access to justice.
If you think you may be part of the “forgotten middle”, it may be worth your while considering taking out a LEI policy.
Moving on to our last question then:
Why should you make a general check of insurance policies you may have already?
What you would be looking for is BTE insurance.
The IBA report mentioned above looks at the operation of LEI insurance in a number of different countries. Some of these use LEI extensively. In others, use is more limited.
Scotland is included in the study as a jurisdiction where LEI is currently available but its use is reckoned to be limited compared to some countries.
One of the contributing factors is a lack of publicity and public awareness about the availability of LEI in Scotland.
Many people have LEI but are not aware of that fact.
Insurers often sell BTE LEI insurance as a bolt-on to some other type of insurance or as an automatic inclusion in an insurance policy bundle. You often get LEI insurance as an add-on to house contents insurance, for example.
This is why you should check any existing insurance policies you may have already because you may have LEI insurance and not know that you do.
What are you looking for so you know if you have LEI insurance?
Probably, the section in the insurance policy will be headed something like: “Legal Protection”.
For the purposes of a possible personal injury compensation claim, the wording might be along the lines of:
“You are covered for Personal injury.
We will pay costs for an incident that causes physical bodily injury to you, or leads to your death. We will only pay costs for claims relating to mental health if they result from an accident also causes physical bodily injury to you.
We don’t cover claims arising from or relating to:
- illness or injury that develops gradually or isn’t caused by a specific or sudden accident
- defending your legal rights in claims against you
- clinical negligence other than those covered under “Clinical negligence” below (in a separate paragraph of the policy).”
In our experience, there is no general standard wording for coverage for legal expenses. Even within “personal injury”, some LEI policies will also extend to medical negligence matters but not all.
In this article, we have looked at the 2 main types of legal expenses insurance – ‘before the event’ and ‘after the event’.
It’s worth considering whether it would be a good idea to take out some form of (BTE) LEI insurance. If you are in the middle income group sometimes referred to as the ‘forgotten middle’, LEI might resurrect your otherwise limited chance of access to justice in the same way that CPR can bring back to life someone who would otherwise die.
You should check any insurance policies you have already – particularly in relation to your home – to see if you have BTE LEI in place already, perhaps as a ‘bonus’ that was not specifically mentioned to you at the time you took out the main insurance policy.
If you reach the point where you need access to justice with the help of LEI insurance but you do not have BTE insurance, you may still be able to fall back onto ATE insurance. However, ATE has more limited scope and tends to be more expensive. Just as a plan to undergo first aid training may be ‘too late’ if the need for CPR is now, you might find that ATE cannot come to your rescue in a situation where BTE might have done. Taking out BTE insurance is about planning ahead.
How we can help
We hope this article has highlighted to you – depending on your financial circumstances – how legal expenses insurance can give you access to justice.
If you’ve any further questions about LEI insurance, please get in touch with us and ask. Also, if you have any questions about our personal injury claims services, generally, we would be glad to hear from you.
Links you might like
The following articles on this website deal with other aspects of legal expenses insurance and we hope you might find them helpful.